Last Wednesday, the Federal Reserve announced that it would start tapering bond purchases later this month, including a monthly reduction of $15 billion of its current $120 billion a month of monthly bond purchases.
Its balance sheet has doubled since the start of the pandemic and currently stands at $8.5 trillion.
Powell made it very clear that the Federal Reserve needs to be patient in raising interest rates as he continues to point to the need of “maximizing employment” as his logic.
I continue to believe central banks are trapped in raising interest rates due to the exponential rise of government debt worldwide to coincide with long-dated securities on many of their balance sheets.
In fact, European Central Bank President Christine Lagarde said this week that it is highly unlikely that the central bank would raise interest rates next year as inflation remains too low, which is a very interesting statement considering Eurozone inflation is currently at a 13 year high driven by this on-going global energy crisis which has shown no room of subsiding which has also brought pressure on food prices as wheat futures continue to surge due to higher input costs.
Kesselrun Resources
I continue to remain bullish on Kesselrun Resources (TSX-V: KES) as a long-term play as it continues to develop its Huronian project, which is situated 100km west of Thunder Bay, Ontario.
The project has extensive existing infrastructure within proximity and is surrounded by numerous multi-million-ounce development and advanced exploration assets.
The project is a former producing asset that hosts a historic resource containing 550k ounces of gold. The resource is adjacent to Goldshores neighboring moss lake property.
Goldshore has commenced 100,000-meter drill program at Kesselruns neighbouring asset and has already started to report widespread gold mineralization at its few first holes.
The best intercepts include:
- 00m at 1.20 g/t Au from 4.0m and
- 00m at 1.15 g/t Au from 182.0m in MMD-21-003
- 00m at 1.18 g/t Au from 122.0m and
- 30m at 2.09 g/t Au from 350.7m in MMD-21-001
- 00m at 1.09 g/t Au from 100.0m in MMD-21-002
These results only represent 2.3% of the planned 100,000 metres and the company is fully financed to complete this program which is expected to wrap up by the end of Q2 of 2022.
As I have been saying to my readers, this represents an emerging area play as both Goldshore and Kesselrun will remain very active with regard to developing their assets in the months ahead.
The almost completed 20,000-metre program at Huronian has been successful as the company has reported multiple high-grade intersects in addition to extending the strike length at the Mckellar by over 500 metres and approximately 100 metres at depth.
The company’s current valuation is under $15 million with a high-grade resource in a good jurisdiction and plans to remain active throughout 2022 in addition to their neighbouring asset.
Today I am joined once again by the company’s President and CEO, Michael Thompson, to provide an update on the Kesselruns development:
Alex Deluce:
Thank you, Michael, for taking the time to provide another update on the Kesselrun story to the Gold Telegraph readers.
Can you provide a general update of how things are going at the Huronian project and touch on the recent news releases?
Michael Thompson:
Thanks Alex. Always a pleasure talking to you. Drilling at Huronian continues and has been going very well. We are keeping our budget under control and our all-in drill costs are, in my estimation, some of the lowest in the industry for the size of the project.
We are extremely pleased with the progress we have been making on expanding the footprint of all 4 zones, particularly the Fisher and McKellar zones. Results have been in line with, to exceeding, the historic results.
A good example is the last news release on the Fisher zone. Not only did we expand the zone to approximately 400 metres in length and 200 metres in depth but we also combined the previously interpreted two separate high-grade shoots into one larger zone.
Alex Deluce:
Can you give us an update on the progress of evaluating the historic resource and the timeline on an NI 43-101 compliant resource estimate?
Michael Thompson:
Our goal is to expand the footprint of the zones aggressively to show the market the true potential of the project while at the same time, we are infill drilling to get to a density of drilling that will allow us to complete a compliant resource estimate. As drilling continues throughout next year, we should be able to give the market some clarity on that timeline.
Alex Deluce:
What is the general plan for Huronian for 2022? If the company can raise a sufficient amount of capital, will the company aim to do another 20,000-metre program?
Michael Thompson:
The plan is to continue drilling of the known zones as previously stated and begin drill testing some of the greenfield targets. There are numerous targets in and around the historic minesite that need to be drill tested. As well, we are looking to begin aggressive exploration on the strike extents to Goldshore’s Moss Lake depost in the southern part of our property.
Alex Deluce:
For my new readers, can you provide a bit of an overview of the Bluffpoint project? I have noticed the company had some terrific grab samples years ago, does the company plan on getting active again at this asset in the future?
Michael Thompson:
Bluffpoint is a very exciting project with geological similarities to the Cote Lake project being developed by Iamgold and Sumitomo. These types of deposits are giants, in the order of tens of millions of ounces of contained gold. Consequently, the footprint of these deposits, the extents of the alteration, are also extremely large. This is what we see at Bluffpoint. In 2022 we plan on doing some geophysics to better understand the mineralizing system to better advance the project.
Alex Deluce:
Finally, Michael, what is your current take on the present gold market and the overall mining sector?
Michael Thompson:
I think this time harkens back to the dot com bubble, a time resultant from loose monetary policy. The difference to today is that we have several orders of magnitude of loose monetary policy resulting in numerous bubbles. The everything bubble as it is being referred to. Eventually it will end and the bubbles will pop and the money will move into hard assets, just as it did post dot com. The gold boom that followed certainly will look like a blip compared to the one that is just starting.
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